Diebold Inc. agreed to pay $2.6 million to settle a lawsuit filed by California alleging that the electronic voting company sold the state and several counties shoddy voting equipment.
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According to the settlement, the North Canton, Ohio-based company must also upgrade ballot tabulation software that Los Angeles County and others used Nov. 2. Diebold must also strengthen the security of its paperless voting machines and computer servers and promise never to connect voting systems to outside networks.

"There is no more fundamental right in our democracy than the right to vote and have your vote counted," California Attorney General Bill Lockyer said in a statement. "In making false claims about its equipment, Diebold treated that right, and the taxpayers who bought its machines, cavalierly. This settlement holds Diebold accountable and helps ensure the future quality and security of its voting systems."
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The original lawsuit was filed a year ago by Seattle-based electronic voting critic Bev Harris and Sacramento-based activist Jim March, who characterized the $2.6 million settlement as "peanuts."
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"This settlement will shut down a major avenue of investigation before evidence starts trickling in," March said. "It's very premature."

A Diebold executive said the settlement would allow the company to spend more money on improving software and avoid "the distraction and cost of prolonged litigation."